On Tuesday, Samsung Electronics Co. SSNLF reported a sharp 56% drop in second-quarter operating profit, citing U.S. export restrictions on advanced AI chips for China — a blow to its semiconductor business just days before its major Galaxy Unpacked product launch.
What Happened: The South Korean chipmaker estimated operating profit at 4.6 trillion won for the April–June period, missing the 6.2 trillion won forecast from LSEG SmartEstimate, reported Reuters.
That marks Samsung's weakest profit in six quarters, down from 10.4 trillion won a year earlier.
In a statement, Samsung attributed the decline to "inventory value adjustments and the impact of U.S. restrictions on advanced AI chips for China."
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Sales were also impacted by delays in shipping high-bandwidth memory (HBM) chips to key U.S. customer Nvidia Corporation NVDA, the report said.
Why It's Important: Samsung's semiconductor struggles underline its dependence on markets where U.S. trade policy now imposes major limitations, notably China. Meanwhile, rivals like SK Hynix and Micron have surged on AI-driven chip demand in the U.S., the report added.
Detailed second-quarter earnings are expected on July 31.
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Samsung's Galaxy Unpacked event on July 9 is expected to spotlight new foldable devices — the Galaxy Z Fold 7 and Z Flip 7 — with leaks pointing to camera upgrades, AI features and thinner designs.
A third foldable, possibly a tri-fold smartphone, may also debut, hinted at by leaks and Samsung's use of the word “Ultra” in marketing.
In addition to foldables, Samsung will likely unveil the Galaxy Watch 8 and Watch 8 Classic, with possible health-tracking improvements like blood glucose monitoring.
There's also a chance Samsung could tease Project Moohan, its upcoming XR headset, though its appearance remains uncertain ahead of a late 2025 launch.
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